twitter linkedin
facebook google+
Search:

Mortgage News

News by Subject
Complete list of specialty news sections.

Purchase Subscription
Subscribe to MortgageDaily.com and get immediate access to all news, statistics and archives.

Mortgage Advertising
Reach mortgage executives, loan originators and other people tied to mortgage industry.

Consumer Mortgage News
Free mortgage news for prospective borrowers.

Mortgage Newsletter
Free e-mail newsletter with the latest headlines from MortgageDaily.com.

Mortgage News Reprints
Put entire MortgageDaily.com stories in your online or printed newsletter or publication.

Mortgage Feedget RSS code
Condensed MortgageDaily.com stories free on your Web site or for your RSS reader.

News Archives
Archive of MortgageDaily.com stories by month going back to 1999.

Press Releases
Reports and announcements from MortgageDaily.com.

Mortgage Statistics
Data and statistics for real estate finance.

Mortgage Directories
Directories of lenders, branch operators and mortgage service providers.

Mortgage Graphs
Directories of lenders, branch operators and mortgage service providers.

home subscribe advertise reprints e-mail help RSS about us LOG IN

Mortgage News

 

Mortgage News

HOT Topics

production

servicing

compliance

legal

fraud

secondary

jobs

appraisal

site map

www.loan-academy.com/

Mortgage Fraud News | Fraud Statistics | Fraud Index | Fraud Blog
Mortgage broker, originator and banker criminal cases. Real estate flipping and appraisal fraud. Mortgage fraud prevention, studies and analysis.



Mortgage Fraud Lawsuits to Skyrocket

FDIC chairman testifies before House committee

March 20, 2009

By MortgageDaily.com staff


The Federal Deposit Insurance Corporation is busy investigating mortgage fraud at failed financial institutions and sees nearly a thousand lawsuits tied to mortgage fraud being filed during the next three years.

Mortgage fraud claims have increased to 4,375 as of today from none on Jan. 1, 2007, Martin J. Gruenberg told the House Financial Services Committee today, according to a transcript of his prepared testimony. He was speaking at the House hearing Federal and State Enforcement of Consumer and Investor Protection Laws.

Gruenberg, who is the FDIC's vice chairman, reported that mortgage fraud lawsuits have climbed to 113 from none at the beginning of 2007. Another 900 civil lawsuits are projected during the next three years as a result of claims currently under investigation.

The defendants in the mortgage fraud lawsuits are primarily mortgages brokers, appraisers and other entities in the closing process that were involved in fraudulent loans funded by one of the 5,000 FDIC-insured banks and thrifts.

The executive explained that the FDIC is responsible for resolving all failures of federally insured U.S. financial institutions. Once a closing occurs, FDIC's investigations staff and attorneys swarm in and determine, among other things, if mortgage fraud contributed to the failure and who was involved.

Professional liability investigations conducted since 1986 have yielded $6.1 billion in recoveries, though $1.4 billion was incurred in expenses. But the high volume of recent failures -- 17 so far this year as of the time of his testimony and three more reported after his testimony -- are expect to push professional liability activity and recoveries substantially higher.

One case was cited on an loan from IndyMac Federal Bank FSB -- which was seized by the Office of Thrift Supervision on July 11, 2008, and sold by the FDIC yesterday. In addition to an inflated appraisal, fake mechanics liens and a property that had been listed for less than the sales price -- a straw buyer was handed a suitcase with $10,000 cash in it.

Two loans for $885,000 wound up costing IndyMac $500,000 in losses.

"The borrower signed two loan applications falsely representing her employment, income and residence, in return for round trip first class airfare from Brooklyn to Houston and car service in Houston to attend the loan closings, in addition to the briefcase of cash," Gruenberg said. "She never resided in the house or made a payment on the loans. In this case, fraud was committed against the FDIC-insured lender by the appraiser, the closing agent, and the borrower."

Political Mortgage News | Mortgage Laws
Mortgage people in politics. Political contributions by mortgage companies. Coverage of political support by lenders and executives. GSE lobbying and issues.



Appraisal News | AMC Directory
Appraisal industry news coverage, including stories about independence requirements, AVMs and appraiser fraud.


Mortgage Fraud News | Fraud Statistics | Fraud Index | Fraud Blog
Mortgage broker, originator and banker criminal cases. Real estate flipping and appraisal fraud. Mortgage fraud prevention, studies and analysis.





SUBSCRIBERS: Edit Subscription | Subscription Help | or call 214.521.1300

Subscribe Contact Us Site Map

Copyright © 2017 Mortgage Daily, D a l l a s
Subsribers Only:

AMC directory

ARM indexes

mortgage company directory

mortgage regulations

net branch directory

p r i c i n g engine directory

wholesale lender directory

More Mortgage News Resources (full site map):

advertising news

appraisal news

bank news

biggest lenders

commercial mortgage news

corporate mortgage news

credit news

FHA news

financial regulation news

foreclosure news

GSE news

jumbo mortgage news

interest rates

loan modification news

loan originator survey

LOS Newsletter

MBS

mortgage associations

mortgage-backed securities

mortgage books

mortgage brokers

mortgage compliance

mortgage conferences

mortgage directories

mortgage education

mortgage employment

mortgage employment index

mortgage executives

mortgage fraud

mortgage fraud blog

mortgage fraud local news

Mortgage Fraud Index

Mortgage Graveyard

mortgage insurance news

mortgage lawsuits

mortgage leads

mortgage lender ranking

mortgage licenses

mortgage litigation

Mortgage Litigation Index

Mortgage Market Index

mortgage mergers

mortgage news

mortgage politics

mortgage press releases

mortgage production

mortgage public relations

mortgage rates

mortgage servicing

mortgage statistics

mortgage technology

mortgage video

mortgage Webinars

net branch

net branch directory

nonprime news

origination news

originator tools

real estate news

refinance news

reverse mortgage news

secondary marketing

social media

servicing news

subprime news

wholesale lenders